Frasers Property Ltd. · SGX:TQ5

Frasers Property — Frasers Commercial Trust — FY2016 Earnings Presentation

37 slides from Frasers Property's earnings presentation, Oct 20, 2016

  1. Slide 1: Frasers Commercial Trust 4QFY16 and FY16 Financial Results

    Frasers Commercial Trust 4QFY16 and FY16 Financial Results 20 October 2016

  2. Slide 2: Important notice

    Important notice Certain statements in this Presentation constitute “forward-looking statements”, including forward-looking financial information. Such forward-looking statement and financial information involve known and unknown risks, uncertainties and other factors which may cause the actual resu

  3. Slide 3: Contents

    Contents 3  Results  Portfolio review  Capital management  Moving Forward

  4. Slide 4: Results

    Results Z J Pease TRUST

  5. Slide 5: Results – Key highlights

     Results – Key highlights 5  S$77.6 million marks the highest distributable income to Unitholders since the Trust was listed in 2006  Full year contribution from 357 Collins Street and Alexandra Technopark boosted performance in FY16 Distribution to Unitholders (S$’000) 14% increase in distributi

  6. Slide 6: Results – 4QFY16 Financial highlights

     Results – 4QFY16 Financial highlights 6  4% rise in distributable income for 4QFY16 1 Jul 2016 – 30 Sept 4QFY16 Y-o-Y Contributing factors 2016 (S$ ‘000) Change (%)  Full quarter contribution from 357 Collins Street and higher revenue contribution from Gross Revenue 39,330 6% Alexandra Technopar

  7. Slide 7: Results – FY16 Financial highlights

     Results – FY16 Financial highlights 7  14% rise in distributable income for FY16 1 Oct 2015 – 30 Sept FY16 Y-o-Y Contributing factors 2016 (S$ ‘000) Change (%)  Full year contribution from 357 Collins Street, higher revenue contribution from Alexandra Technopark due to higher rental rates and up

  8. Slide 8: Results – 4QFY16 Financial highlights

     Results – 4QFY16 Financial highlights 8 Full quarter contribution from 357 Collins Street and better performance from Alexandra Technopark TOTAL: S$29.3 million for 4QFY16 Net Property Singapore: S$15.9 million (54%) Income (S$m) Australia: S$13.4 million (46%) * Affected units were mainly retail

  9. Slide 9: Results – FY16 Financial highlights

     Results – FY16 Financial highlights 9 Full year contribution from 357 Collins Street and better performance from Alexandra Technopark TOTAL: S$115.6 million for FY16 Net Property Singapore: S$63.3 million (55%) Income (S$m) Australia: S$52.3 million (45%) * Affected units were mainly retail units

  10. Slide 10: Results – Financial highlights

     Results – Financial highlights  All-time high in DPU  Seventh consecutive year of DPU growth since recapitalisation exercise  DPU grew at 9.8% CAGR from FY10 – FY16 DPU (Cents) * Adjusted for Unit consolidation

  11. Slide 11: Results – Financial highlights

     Results – Financial highlights  2016 marks the 10th anniversary since the Trust was listed on 30 March 2006  FY16 distributable income and DPU the highest in the decade Highest for the decade Distributable income to 30 March 2006 Unitholders (S$m)1 No. of properties: 2 Portfolio value: S$0.7 bil

  12. Slide 12: Results – Distribution payment

     Results – Distribution payment 12 DRP will be applied for the distribution for 4QFY16 Distribution Period 1 July 2016 to 30 September 2016 Distribution of 2.4531 cents per Unit comprising: a) taxable income distribution of 1.6954 cents; Ordinary Unit Distribution Rate b) tax-exempt income distribu

  13. Slide 13: Portfolio review

    Portfolio review FRASERS COMMERCIAL

  14. Slide 14: Portfolio review – Valuation

     Portfolio review – Valuation 14  Portfolio value up 1.8%  Higher valuation for Alexandra Technopark, 55 Market Street, Caroline Chisholm Centre and 357 Collins Street Local Variance from 30 Variance from 30 Date of currency Translation as at September 2015 (local September 2015 valuation Value 3

  15. Slide 15: Portfolio review – Valuation

     Portfolio review – Valuation 15  Balanced portfolio consisting of Singapore and Australian properties  No one property consist of more than 28% of portfolio value Singapore Perth Canberra Singapore $ 1,209.5 61% Melbourne Australia $ 779.8 39% Total $ 1,989.3 100% As at 30 September 2016. Exclud

  16. Slide 16: Portfolio review – Occupancy Rates & WALE

     Portfolio review – Occupancy Rates & WALE 16  Healthy average occupancy rate of 93.0%  Healthy WALE of 3.0 years Geographical occupancy and % of NPI contribution As at Key portfolio statistics 30 September 2016 Ave Occupancy 93.0% Portfolio WALE by gross rental 3.0 years income  China Square Ce

  17. Slide 17: Portfolio review – Lease expiry profile

     Portfolio review – Lease expiry profile 17 17 Well spread lease expiry profile provides income stability Following the early An entity of Rio Tinto Limited signed a Heads of renewal of the Microsoft Agreement for a new lease for 12 years from FY18 to lease at Alexandra FY30 at Central Park. 6.3% o

  18. Slide 18: Portfolio review – Lease expiry profile

     Portfolio review – Lease expiry profile 18 Continuous proactive management of leases Following the early renewal of the Microsoft lease for a further 5 years from FY17 to FY22, the lease expiry in FY17 was reduced to Property Lease Expiry in FY17 as a 9.8% proportion of Portfolio Gross Rental Inco

  19. Slide 19: Portfolio review – Rental reversions

     Portfolio review – Rental reversions 19  Singapore properties continue to achieve positive rental reversions for new and renewed leases that commenced in 4QFY161 despite the challenging leasing market  Singapore properties consistently achieved positive rental reversions every quarter Weighted a

  20. Slide 20: Portfolio review – Robust leasing activities

     Portfolio review – Robust leasing activities 20  Robust leasing activities  Committed, new and renewed tenants in 4QFY16 include: Tenant Industry Property Grasshopper Pte Ltd Financial services China Square Central Berkeley Insurance Insurance China Square Central Lucror Analytics Pte Ltd Consul

  21. Slide 21: Portfolio review – Mid-term rent reviews

     Portfolio review – Mid-term rent reviews 21 21 50% of leases have built-in step-up rents FY17 - Fixed % and other fixed lease rent reviews FY17 – 20 - Portfolio fixed % reviews GROSS RENTAL INCOME Average Total Property Leases step-up rent Property Portfolio China Square 3 1.5% 18.9% 3.4% Central

  22. Slide 22: Portfolio review – Stability of income

     Portfolio review – Stability of income 22 Top 10 tenants:  Established and well diversified across various sectors  MNCs, government department or public listed companies  Contribute 57% of portfolio gross rental income and have a long WALE of 5.2 years Top 10 tenants by gross rental income % (

  23. Slide 23: Asset updates – Developments at China Square Central

     Asset updates – Developments at China Square Central 23  Construction work for the development of a 16 storey hotel and Commercial Project1 are on track2  New retail and commercial spaces with better frontage and visibility will also be created2  Construction expected to be completed by mid-201

  24. Slide 24: Portfolio review – Singapore asset updates

     Portfolio review – Singapore asset updates 24 China Square Central – high 55 Market Street – Alexandra Technopark – occupancy at office tower healthy occupancy rate healthy occupancy rate Occupancy 88.9% (office tower: 99.4%)* 92.0% 94.8% WALE 1.5 years 1.7 years 1.2 years (1.6 years with lease ex

  25. Slide 25: Portfolio review – Australia asset updates

     Portfolio review – Australia asset updates 25 Caroline Chisholm Centre Central Park – Healthy WALE of – full occupancy with 357 Collins Street – full 6.7 years# long WALE of 8.8 years occupancy Occupancy 80.2% 100.0% 100.0% WALE 2.1 years (6.7 years with new lease#) 8.8 years 4.6 years New leases,

  26. Slide 26: Capital management

    Capital management FRASERS COMMERCIAL

  27. Slide 27: Capital Management – Debt statistics

    27  Capital Management – Debt statistics 27  Healthy interest coverage ratio of 4.6 times  Low average interest rate of 3.02%  Borrowings in AUD provide natural hedge for the Australian properties Statistics Borrowings and assets by currency As at 30 September 2016 Total Assets (S$’000) 2,069,35

  28. Slide 28: Capital Management and debt statistics

    28  Capital Management and debt statistics 28  Well spread debt maturity profile  No refinancing required until September 2017 and all debts are unsecured  85% of gross borrowings on fixed rate  Maiden issuance of S$100.0 million five-year senior unsecured notes at fixed rate of 2.835%  Net pr

  29. Slide 29: Moving forward

    Moving forward

  30. Slide 30: Solid fundamentals - Singapore office rents

     Solid fundamentals - Singapore office rents 30 Singapore office - Grade B rents relatively more stable Singapore Grade A and Grade B office rents1 Grade A CBD Core ↓ 2.1% qoq to S$9.30 psf Grade B Islandwide ↓ 2.1% qoq to S$7.10 psf Grade B CBD Core ↓ 2.0% qoq to S$7.50 psf Source: CBRE Research 1

  31. Slide 31: Solid fundamentals - demand, supply and outlook for Singapore CBD office

     Solid fundamentals - demand, supply and outlook for Singapore CBD office 31 Office supply-demand dynamics and vacancy rates 1  Q3 2016 total Islandwide office net absorption was 820,417 sf, reversing the four consecutive quarters of contraction  Island-wide vacancy remained relatively stable at

  32. Slide 32: Solid fundamentals - Singapore business park rents

     Solid fundamentals - Singapore business park rents 32 Singapore business park rents trend – City fringe business park rents remained stable in Q3 20161 Singapore Business Park (city fringe) rents1 Source: CBRE Research 1 CBRE, Singapore Market View, Q3 2016

  33. Slide 33: Solid fundamentals - demand, supply and outlook for business park

     Solid fundamentals - demand, supply and outlook for business park 33 Business Park supply-demand dynamics and future pipeline1  Business parks island-wide vacancy declined to 12.5% in Q3 2016 from 13.8% in Q2 2016, despite the overall soft demand conditions in the economy  Stable enquiry levels

  34. Slide 34: Perth CBD office supply and rents

     Perth CBD office supply and rents 34  Net absorption in the twelve months to June 2016 was negative 17,241 sqm  Premium Grade face rents fell 0.7% to an average of A$710 per sqm per annum  Average Premium Grade incentives around 45% looked to have peaked  Increasing interest from suburban tena

  35. Slide 35: Melbourne CBD office supply and rents

     Melbourne CBD office supply and rents 35  Vacancy fell to its lowest level in three years, down from 8.1% to 7.0%1  Premium and A grade net absorption totaled 58,319 sqm, accounting for 87% of the office space absorbed in the 12 months to July 2016  Average net face rent for prime grade office

  36. Slide 36: Delivering growth

     Delivering growth 36 36 Organic and in-organic initiatives to deliver growth in distributable income Grow portfolio organically and inorganically Proactive Asset enhancement management of expiring leases DPU initiatives Prudent capital management

  37. Slide 37: Thank you

    Thank you Frasers Centrepoint Asset Management (Commercial) Limited Level 21 | 438 Alexandra Road | Alexandra Point | Singapore 119958 Tel: +65 6276 4882| Fax: +65 6276 8942| Email: fcot@fraserscentrepoint.com www. fraserscommercialtrust.com

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